Block 22/12, Beibu Gulf

HZN_China-Beibu_Proposed-Development-CNOOC_WEB_October-2016

 

Participating interests in the Beibu Gulf Development Project are:

Exploration

Production and Development

Horizon Oil (Beibu) Ltd and Petsec Petroleum LLC (wholly owned by Horizon Oil Limited)

55%

26.95%

CNOOC Limited

0%

51.0%

Roc Oil (China) Company

40%

19.6%

Oil Australia Pty Ltd (Majuko Corp)

5%

2.45%

 

Horizon Oil’s working interest share of production from the Beibu Gulf fields was 903,598 barrels of oil. Crude oil sales were 903,198 barrels at an average price of US$37.91/bbl exclusive of executed hedging. Cumulative gross oil production from the fields through 30 June 2016 was 12.3 million barrels.

 

Gross production averaged 9,161 bopd, of which Horizon Oil’s share was 2,469 bopd. Aggregate Block 22/12 production is approximately 27% ahead of budget, with full year production approximately 8% ahead of budget. During 2016, Horizon Oil’s Block 22/12 production entitlement increased from 26.95% to over 35% of production, following the commencement of its entitlement to preferential cost recovery.

 

On 18 December 2015, the WZ 12-10-2 field, located in the Weizhou 12-8 Fields Area of Block 22/12, Beibu Gulf, People’s Republic of China, had commenced production. The WZ 12-8W-A6P1 well was drilled to appraise the accumulation discovered by the WZ 12-10-2 well in 2014 and, following this appraisal, a horizontal production sidetrack (WZ12-8W-A6H) was completed and brought on to production. The well was brought online and after an initial clean up period, produced at over 1,400 bopd with a GOR of 40 scf/bbl.

 

This well will deliver near term incremental production to the existing WZ 12-8W / WZ 6-12 production facility, and provide data to determine production and reservoir performance in the WZ 12-10-2 oil pool to assist in future development evaluations. Preparation of the Overall Development Plan for the WZ 12-8E field continued, with completion scheduled in 2017.
 

The audited gross 2C resources for the field (including WZ 12-10-1 and WZ 12-3-1) are 11.1 mmbo. To investigate options that can make this project economic at low oil prices, contractors have been invited to bid for this project through Engineering, Procurement, Construction and Installation (EPCI) on lump-sum and competitive cost basis, with bids due in the second half of calendar year 2016.

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